Osborne swallows loss of £7bn in RBS sell-off

The bailed-out bank is to be sold off nearly seven years after it was rescued
by the taxpayer

By Peter Dominiczak, Political Editor, video source ITN

11:28PM BST 10 Jun 2015

The Royal Bank of Scotland is to be sold off at a loss to taxpayers of more than £7billion, George Osborne has announced.

The Chancellor used a speech in the City of London to announce that the bailed-out bank is to be sold off nearly seven years after it was rescued by the taxpayer.

The bank was bailed out by the British taxpayer to the tune of £45.2billion for an 80 per cent stake.

It is possible that the public will eventually be given the chance to buy shares as part of a “Tell Sid” style sell-off, but major investors will be given the first opportunity to take advantage, the Treasury said.

George Osborne addresses the Bankers and Merchants Dinner at Mansion House (Julian Simmonds/The Telegraph)

Mr Osborne also used his annual Mansion House speech to threaten to withhold British support for the Eurozone unless Brussels submits to UK's demands for reforms ahead of David Cameron’s in-out referendum.

He said: “It’s in our interests that the Euro is a successful, strong currency. So we’re prepared to support the Eurozone as it undertakes the further integration it needs.

“But in return, we want a settlement between the UK and the Eurozone that protects the single market and is stable, fair and lasts.”

His comments raise the prospect of Britain demanding a two-speed EU, with countries not in the Eurozone having a far looser relationship with Brussels.

Mark Carney addresses the Bankers and Merchants Dinner at Mansion House as George Osborne (left) looks on (Julian Simmonds/The Telegraph)

Mr Osborne said that his decision to sell off the Government’s stake in RBS was taken after he received advice from Mark Carney, the Governor of the Bank of England.

“Frankly, in the short term the easiest path for the politician is to put off the decision and leave it to someone else at some future time to pick up the pieces,” Mr Osborne said.

“I’m not interested in what’s easy – I’m interested in what’s right.

“I was not responsible for the bailout of RBS or the price paid then for shares bought by the taxpayer: but I am responsible for getting the best deal now for the taxpayer and doing whatever I can to support the British economy.